Some German plate buyers are taking advantage of the pre-summer dip at Italian re-roller mills, especially those in the south, while others see such purchases as opportunistic.
Italian domestic prices have been heard dipping to €720/tonne ($820/t) for S275 ex-works. While in theory this could mean €20/t more for S355, offers to foreign customers can differ quite a bit from domestic offers.
A manager of a German distributor on the northern coast states that Italian offers for him do not make sense with transport prices of €100/t. However, he is aware of some who have concluded such deals. For some machinery-builders, flame-cut material in Italy is offered without extra processing charges, and therefore is workable in some cases.
“They will do that once or twice, but then they are back with us,” the manager tells Kallanish, describing the purchasing behaviour as short-term opportunism. “The Italians yearn to fill their order books before their summer break, and thereafter they will be back at €100/t more,” he says.
The observation is shared by a northwestern European mill source, who notes that the Italian bargain offers do take influence on northern mills. These mills “need to adjust somewhat in order not to leave the market to the Italians too much,” he says.
For most of June, offers of northwestern European mills ranged widely between €800-€850/t for S355. Last week, those mills were heard striving for a notable increase of €50-70/t, despite the continued lull of demand. Hence, those hike efforts will not be proven in transactions for a while.
For the moment, the pre-summer effect has actually some offers go the other direction, dipping below the €800/t mark.
That could compete with Italian offers to Germany, which, according to a Bavarian Buyer, are at €750/t plus €60/t for transportation. But he notes that “we in the south are pretty much oriented towards Italy, and hardly buy German”.
